Piramal Pharma gets Sebi go-ahead to raise Rs 1,050 cr through rights issue, stock rises
In an update on the Sebi website it was mentioned that the pharma company has received an observation letter from Sebi on July 12 in response to the draft papers it submitted in March.
- Jul 19, 2023,
- Updated Jul 19, 2023 12:37 PM IST
Pharmaceuticals major Piramal Pharma has received a go-ahead from markets regulator Securities and Exchange Board of India (Sebi) to raise up to Rs 1,050 crore through rights issue of shares.
In an update on the Sebi website it was mentioned that the pharma company has received an observation letter from Sebi on July 12 in response to the draft papers it submitted in March.
Sebi's observation letter means its approval for public offerings, including initial public offerings (IPOs) and rights issues.
A rights share issue is an offering of rights given to a company's existing shareholders, allowing them to purchase additional shares directly from the company at a discounted price, rather than buying them through the secondary market.
On Wednesday, the stock opened at Rs 101.00. At 11.45 am, the stock was trading at Rs 100.60 apiece on the BSE. Piramal Pharma shares halved over the last 12 months.
According to the draft papers submitted to Sebi, Piramal Pharma will issue fully paid-up equity shares of the company by way of a rights issue to its existing eligible shareholders for an amount aggregating up to Rs 1,050 crore. The proceeds will be utilised for payment of debt and general corporate purposes.
In July, US-based investment firm Smallcap Fund Inc sold its entire stake in Piramal Enterprises through block deals. Smallcap Fund Inc offloaded 23.92 lakh shares or 1 per cent stake in the company, as per updates on the exchanges.
Besides, New Fund World has also offloaded 1.45 per cent stake in Piramal in the transaction, which was executed at Rs 941 apiece. The shares were bought by marquee investors including Tata Mutual Fund, Societe Generale, Morgan Stanley, Goldman Sachs, Citigroup, BoFA Securities.
Caisse De Depot Et Placement Du Quebec (CDPQ), a global investment group, recently sold a portion of its investment in Piramal Pharma Ltd. Through an open market transaction, CDPQ divested 1,05,70,466 shares, which accounted for 0.89 per cent of Piramal Pharma's stake. The shares were sold at an average price of Rs 94.48 each, resulting in a total transaction size of Rs 99.86 crore.
Piramal Enterprises, which is engaged in diversified business, such as financial services and pharmaceuticals, has a majority owned by public shareholders at 56 per cent, its promoters have the rest of 43 per cent in the company.
The company, in its March quarter statement, has said that among the public shareholders, mutual funds have about 4.25 per cent stake, and foreign investors own 28.4 per cent in the company.
Piramal Pharma provides end-to-end pharma services to customers and a portfolio of differentiated pharma products across a domestic and global distribution network.
It operates under three business verticals - Piramal Pharma Solutions, an integrated contract development and manufacturing organization (CDMO); Piramal Critical Care, a complex hospital generics (CHG) business and India consumer healthcare (ICH) business, selling well-known over the counter brands such as Little's, Lacto Calamine and i-Pill.
(With agency inputs)
Also read: PM Narendra Modi's 10th year in office: What Bernstein says on stock market, economy
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Pharmaceuticals major Piramal Pharma has received a go-ahead from markets regulator Securities and Exchange Board of India (Sebi) to raise up to Rs 1,050 crore through rights issue of shares.
In an update on the Sebi website it was mentioned that the pharma company has received an observation letter from Sebi on July 12 in response to the draft papers it submitted in March.
Sebi's observation letter means its approval for public offerings, including initial public offerings (IPOs) and rights issues.
A rights share issue is an offering of rights given to a company's existing shareholders, allowing them to purchase additional shares directly from the company at a discounted price, rather than buying them through the secondary market.
On Wednesday, the stock opened at Rs 101.00. At 11.45 am, the stock was trading at Rs 100.60 apiece on the BSE. Piramal Pharma shares halved over the last 12 months.
According to the draft papers submitted to Sebi, Piramal Pharma will issue fully paid-up equity shares of the company by way of a rights issue to its existing eligible shareholders for an amount aggregating up to Rs 1,050 crore. The proceeds will be utilised for payment of debt and general corporate purposes.
In July, US-based investment firm Smallcap Fund Inc sold its entire stake in Piramal Enterprises through block deals. Smallcap Fund Inc offloaded 23.92 lakh shares or 1 per cent stake in the company, as per updates on the exchanges.
Besides, New Fund World has also offloaded 1.45 per cent stake in Piramal in the transaction, which was executed at Rs 941 apiece. The shares were bought by marquee investors including Tata Mutual Fund, Societe Generale, Morgan Stanley, Goldman Sachs, Citigroup, BoFA Securities.
Caisse De Depot Et Placement Du Quebec (CDPQ), a global investment group, recently sold a portion of its investment in Piramal Pharma Ltd. Through an open market transaction, CDPQ divested 1,05,70,466 shares, which accounted for 0.89 per cent of Piramal Pharma's stake. The shares were sold at an average price of Rs 94.48 each, resulting in a total transaction size of Rs 99.86 crore.
Piramal Enterprises, which is engaged in diversified business, such as financial services and pharmaceuticals, has a majority owned by public shareholders at 56 per cent, its promoters have the rest of 43 per cent in the company.
The company, in its March quarter statement, has said that among the public shareholders, mutual funds have about 4.25 per cent stake, and foreign investors own 28.4 per cent in the company.
Piramal Pharma provides end-to-end pharma services to customers and a portfolio of differentiated pharma products across a domestic and global distribution network.
It operates under three business verticals - Piramal Pharma Solutions, an integrated contract development and manufacturing organization (CDMO); Piramal Critical Care, a complex hospital generics (CHG) business and India consumer healthcare (ICH) business, selling well-known over the counter brands such as Little's, Lacto Calamine and i-Pill.
(With agency inputs)
Also read: PM Narendra Modi's 10th year in office: What Bernstein says on stock market, economy
Also read: Bikaji Foods shares rise 6% to hit new 52-week high after 'Bhujialalji' stake acquistion